The CFTC is considering a review of Crypto.com’s football futures contracts, including Super Bowl bets, to determine compliance with gaming laws.
Reports say that the US Commodity Futures Trading Commission is thinking about whether to check into whether Crypto.com’s futures contracts that let people bet on football games, including the upcoming Super Bowl, are legal.
Bloomberg reported on January 14 that five CFTC Commissioners are deciding on whether to put the contracts on hold for 90 days so that they can be looked at again to see if they break any gaming laws.
There is no way for the CFTC to stop dealing the contracts right away, and any review would end after the Super Bowl on February 9. However, the contracts could be banned after that.
Crypto.com runs a derivatives market in the US. On Dec. 19, it told the CFTC in the right way that it would start trading the contracts on Dec. 23.
Bloomberg said that the office didn’t have time to look them over before Christmas because there was a chance that the government would shut down at the time.
The possible investigation comes as the CFTC fights to control “event contracts,” which let people bet on anything from sports to the exact words leaders will use in important speeches. People became more familiar with them thanks to decentralized betting markets like Polymarket, which says it doesn’t do business in the US.
The agency has filed an appeal after losing in court against Kalshi, a betting market provider, over contracts it offered for the 2024 US elections.
The agency says the contracts violate gaming laws. A representative for Crypto.com told Bloomberg that the company now has a better understanding of the law when it comes to event contracts after the CFTC’s loss.
A Crypto.com spokesperson told Cointelegraph that the firm hasn’t been notified of any CFTC action and added, “It is disappointing that the current and imminently departing CFTC leadership would consider this action while not allowing the incoming CFTC leadership to determine how free markets operate under its administration.”
Users of Crypto.com’s contracts can bet on the outcomes of college football and National Football League games, including the Super Bowl, which is the league’s championship game and one of the most-watched sports events in the world.
Users can only hold 2,500 contracts, and each one is worth $100. Market makers on the site, on the other hand, can hold up to 250,000 contracts.
Rostin Behnam, the chair of the CFTC, will step down on January 20 when Trump takes office. The new president hasn’t named a replacement yet, but he is said to want pro-crypto CFTC Commissioner Summer Mersinger to lead the agency.